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Broker commission hikes: Where are they?

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Australian Broker | 14 Aug 2013, 08:00 AM Agree 0
Bank funding costs are down, so why haven't commissions gone up for brokers? We talk to Aussie Home Loans CEO, Ian Corfield, to find out
  • Jack | 14 Aug 2013, 09:20 AM Agree 0
    Talk and rhetoric. Margins are significantly (not marginally) better than they were; but Banks will always avoid paying until our industry shows greater signs of decay - I know, I worked there.
  • Sydney Broker | 14 Aug 2013, 09:21 AM Agree 0
    You cannot argue that its not sustainable. Banks are falling over themselves to offer increasingly large discount to clients. Discounts of 1% or more were impossible pre GFC unless you had a loan well over $1 million. These days they are often handed out. Make the discounts more reasonable and stop the pricing war. Then pay us the trails back.
    The industry willbe more sustainable with more trail and volumes will increase. Brokers can recruit and train and retain more staff. They can spend more on marketing and new business generation. Banks wait for clients to knock on the door. Brokers will go out and make it happen. We have to as we dont have the brand and multi million dollar marketing budget.
    With an increase in sustainable income, brokers will generate NEW business.
  • oldBroker | 14 Aug 2013, 09:52 AM Agree 0
    Commissions will rise only if the percentage of broker-initiated deals increases to (I think) around the 75% range as opposed to the 40% currently.
    The lenders don't owe us a living and they reduced the commissions because they can. It's a fairy-tale to think otherwise. CBA eliminated first year trail and their market share remained stable. Simple supply and demand.
  • Broker | 14 Aug 2013, 10:23 AM Agree 0
    The banks objectives are the exact opposite, so lets not kid ourselves here..
  • Michael | 14 Aug 2013, 10:58 AM Agree 0
    Typical thoughts from an ex banker as you wouldn't have had Auz John or James making such bank friendly comments about our commissions.
  • Wilko | 14 Aug 2013, 12:48 PM Agree 0
    Its a simple equation. As broker market share rises and the banks realise they wont be able to compete, as hard they will use and support whatever distribution channel suits and if it means better commissions for greater market share then they will do it.

    I think Mr Corfield is astute in his thinking but realistic at the same time. Keep the rates low and it will become sustainable.
  • oldBroker | 14 Aug 2013, 03:14 PM Agree 0
    Commissions will rise only if the percentage of broker-initiated deals increases to (I think) around the 75% range as opposed to the 40% currently.
    The lenders don't owe us a living and they reduced the commissions because they can. It's a fairy-tale to think otherwise. CBA eliminated first year trail and their market share remained stable. Simple supply and demand.
  • Allan | 14 Aug 2013, 04:06 PM Agree 0
    "Sustainable?" Checked out the banks profits lately Mr Corfield? Think we know what side this chap is really on..
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